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National Savings Certificate

NSC Interest Rate

Last Updated 23rd May 2022

  • The NSC interest rate is regulated by the government of India.
  • All Indian residents can invest in the NSC, whether individually, jointly or on behalf of minors.
Interest rate6.8%
Minimum deposit₹ 100
Maximum depositNo upper limit restrictions
Investment tenure5 years
Offered byBanks and Post offices
Yes Bank
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What is a National Savings Certificate (NSC)?

NSC or National Savings Certificate is a savings cum investment facility that is offered by financial institutions like banks and post offices. The scheme is offered to all Indian residents and provides benefits like fixed return and secured investment. Apart from that, NSC offers tax benefits on both medium and small savings along with regular returns. The interest rate of NSC is regulated by the Indian Government. Currently, the NSC interest rate is 6.8%. All Indian residents, including minors, can avail the NSC certificate, wherein Individuals can invest jointly or solely or on behalf of minors.

How to invest in National Savings Certificates?

Indian residents can invest in NSC certificates through any bank or post office. However, this requires one to submit the KYC documents, and make a physical visit to the National Saving Scheme provider. Follow the below-mentioned steps to make an investment in NSC:

  • Fill out the National Saving Certificate scheme application form with the NSC provider or the NSC online form.
  • Along with the form attach self-attested copies of the required KYC documents such as PAN and Aadhaar.
  • After filling the form, make a physical visit to the bank or post office. Carry the original documents for the document verification process.
  • After the verification, proceed further by making a payment for the amount you wish to invest in the NSC.
  • On successful completion of the payment, get a receipt of the NSC for the invested amount from the concerned bank or post office.

You can also invest in NSC online with the help of internet banking if you are a savings account holder in the authorized bank. The NSC online purchase is recorded in two forms that are the electronic or e-mode and the passbook mode.

Who Should Invest in NSC?

Similar to Public Provident Funds and fixed deposits, the National Savings Certificate offers guaranteed returns along with the security of investment. Thus, individuals looking for a small or medium-range investment with low risk and high security can invest in the NSC. Thus all individuals, joint individuals and guardians on behalf of the minors can invest in this scheme. However, HUFs or the Hindu Undivided Family, Trusts, Private and Public Limited Companies and Non-resident Indians cannot invest in the National Savings Scheme.

Documents Required for NSC

The documents required to avail the National Savings Certificate scheme are listed as follows:

  • National Savings Scheme application form.
  • Recent passport size photographs
  • Identity proofs such as Aadhar Card, PAN card Passport, Driving License, Government ID or Senior Citizen ID(wherever applicable).
  • Address proofs such as Aadhar card, Voter ID card, Passport, Utility bills such as water, electricity, gas etc
  • Cheque or cash if payment is to made through offline modes.

NSC Benefits & Features

Some of the key benefits and features of the National Savings Certificate are listed as follows:

  • Investments made in NSC involve low risk and are highly secured, due to the fact that the government of India backs the funds.
  • Individuals can invest in NSC with a minimum deposit of ₹ 100 and with no restrictions on the upper limit. However, investments made in NSC must be in multiples of 100.
  • NSC allows the investment of funds for a tenure of 5 or 10 years.
  • NSC offers a high return on the invested amount, due to the NSC interest rate that currently stands at 6.8%. This interest, however, is payable to the investors at the time of maturity with the NSC maturity value.
  • NSC savings scheme is not only an investment but also allows individuals to take a loan against it.
  • NSC provides the benefit of tax exemption of up to Rs 1.5 lakhs per annum.
  • In case an individual dies during the NSC savings tenure, then the investment can easily be transferred to another family member or the nominee.
  • Though premature withdrawal from the NSC certificate is not allowed. However, under certain circumstances, one can withdraw funds partially from the NSC investment. It can be done due to the demise of the actual investor or as per the court orders.
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Tax benefits for NSC investment

One of the major benefits that NSC offers is that it is a tax saving investment option. Some of the tax implications of NSC are mentioned as follows:

  • As per section 80C under the Income Tax Act, one can avail tax benefit up to ₹ 1.50 Lakh per annum on the principal amount invested in NSC.
  • As far as the interest rate is concerned, the interest earned in the first four years of the investment tenure is exempted for tax and allows a further deduction as per section 80C. It is because the interest earned during these four years is considered as reinvestment with the principal amount.
  • The interest earned in the fifth year is not reinvested; thereby, it is taxable as per the income tax slab. However, TDS is not applicable on the NSC.


Is NSC available in banks?

Yes, NSC is available in Banks. It is offered by all public sector banks and by authorized private sector banks as well.

Are Saving Certificates worth it?

National Savings certificate is a beneficial savings-cum-investment option that provides a number of benefits, especially to individuals looking for small and medium investments. It also offers fixed returns, security and tax benefits to the investor. Thus, NSC is worth investing your funds in.

Is there a lock-in period with Investment in NSC?

Yes, the lock-in period with Investment in NSC is five years.

What is the minimum limit for investing in NSC?

Investments in NSC can be made with a minimum amount of 100, that can range up to any amount, as there is no upper limit restriction.

Which is a better NSC or PPF?

Both NSC and PPF are saving-cum-investment schemes that are regulated by the Government of India. However, the major difference between them is the interest earned on PPF is entirely tax-free, while the interest earned on NSC during the fifth year is taxable. NSC, on the other hand, provides the benefit of minimum Investment of ₹ 100 with no upper limit, while PPF allows investments only upto ₹ 1.50 Lakh. Thus, both NSC and PPF have different benefits to offer, and as per the personal requirement, one can figure out which one is better.

How do I get a national savings certificate?

You can get a national savings certificate from a bank or a post office by filling out the National savings certificate form, available both offline and online. Savings account holders of Banks and post offices can directly buy NSC online if they have access to internet banking.

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